Daily Deduction

Another Request For Trump’s Tax Returns, And Making America Trade Again.

Grassley will request Trump’s tax returns too. The Senate Finance Committee Chair says he’ll ask for the president’s returns if House Ways & Means Committee Chair Richard Neal does. Grassley told reporters yesterday he doesn’t want Neal’s request to become partisan: “I'm not asking for the tax returns, but if the House of Representatives are going to get them, then I want the Senate Finance Committee to have them." Neal reportedly is preparing his request, which the Treasury is expected to reject.

Trump promised to shrink the US trade deficit. It is getting bigger. The US merchandise trade deficit hit a record $891.2 billion last year, according to the US Department of Commerce. The trade gap grew even after the Trump administration levied tariffs on imported solar panels, washing machines, steel, aluminum, and assorted goods from China. To economists, at least, it was no surprise.

Brady goes to war over France’s digital tax. Top Ways & Means Republican Kevin Brady, a long-time critic of European efforts to impose a digital tax on US tech companies, minced no words about France’s proposed levy: "If France goes through with this tax, it would result in double taxation and violate longstanding norms, [and] could very well [cause] a review of American tax and regulatory policies to ensure a level playing field in global markets.”

Also at Ways & Means… The panel’s Subcommittee on Oversight holds a hearing this morning with Taxpayer Advocate Nina Olson on the 2018 tax filing season. Next Tuesday, the Select Revenue Measures subcommittee will hold a hearing on temporary policy in the Internal Revenue Code (also known as “tax extenders”).

Downgrading revenue rulings. Treasury and IRS say they will rely less on sub-regulatory guidance such as revenue rulings, revenue procedures, notices, and announcements, as well as temporary regulations. The department said that because these interpretations do not go through the formal notice-and-comment process, they don’t have the full force of law.

Illinois Attorney General Kwame Raoul sues tax preparers for cheating low-income taxpayers. In a complaint filed in Cook County circuit court, Raoul alleged that “customers, many of whom are low-income, only receive a fraction of their expected tax refunds and risk losing future refunds” while two companies, Nu Republic and Refund Republic, profited by charging high fees. The firms targeted their marketing at people who rely heavily on the earned income tax credit, offering cash advances on the refund and chances to win prizes.

New Jersey Governor Phil Murphy releases his millionaire’s tax plan. The Democrat wants to raise the state income tax on those earning more than $1 million a year. His plan is a lot like one he pursued last year that ran into opposition from the Democratic-controlled legislature. This year, some Democrats have shifted leftward, arguing that a millionaire’s tax can mitigate income inequality and cover the cost of social programs like Medicare for All. But State Senate President Stephen Sweeney and State Assembly Speaker Craig Coughlin say they’ll oppose new taxes without spending reforms.

When it comes to paying for child care, do parents want tax subsidies, or payments to providers? The Tax Hound considers the appetite for presidential candidate Senator Elizabeth Warren’s proposed Universal Child Care and Early Learning Act. Warren may not be giving parents across the income spectrum what they really want… or need.

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